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Or perhaps this should be phrased the other way around, stock is now at $1,000 a piece or so because Wall Street has rather gotten over an old fetish that is used to have. This isn't anything at all to do with the value of Google as a company, nor the total value of its outstanding stock. That is determined by the net present value of expected future profits from the company, not by some so odd as a folk belief or fetish. No, I'm talking rather about that $1,000 number and why people don't do stock splits like they used to:

With its surge on Friday, Google Inc became the latest member, though not likely the last, of a tiny fraternity of companies that boast $1,000 share prices.

In a market where stock splits have become rarer, there may be more of this to come than just the two stocks with four-digit stock prices in the Standard & Poor's 500 index - Google and , which hit $1,000 earlier this year.

Historically, once share prices got too high - even around $125 a share - companies split shares to make them more accessible to Main Street investors. But splits have become few and far between, and big numbers are more the norm for familiar names like Inc, Inc, Inc and Inc.

This is true: companies used to split their stock when prices got to that $125 level or so. For the folk belief was, the fetish if you like, that investors "liked" stocks that were in the $10 to $100 range. If a stock price went considerably above that range then it would split, say a two for one at $140, leaving the investor with two shares at $70 each instead of one at $140. Similarly, if a stock dipped below $10 it might well do a stock consolidation, taking in two shares at $7 each to leave the investor with one new one at $14.

There's no particular reason this should work in any manner, it's only a change in the nominal value, the total value of any shareholding would be the same at the end. The same percentage of the same company and presumably the same dollar value. Except that it wasn't the same dollar value at the end of it all. Despite there being no particular reason this should be true that two shares at $70 would end up being worth $72 each (purely an example plucked from the air you understand) that $14 consolidated stock would be $15.

Given that there was in fact no reason why this should be true it ends up that it was true only because lots of people believed that investors liked stocks in the $10 to $100 range. Thus if a company did a split/consolidation everyone placed a higher value on the stock because they thought everyone else would do so.

There's something of a holdover in this in that a stock will be delisted from Nasdaq if it consistently trades below $1 a share. A consolidation must take place, one that makes no difference at all to the total value of the company (except, of course, that it gets to stay on Nasdaq), but one which gets that nominal stock price back over $1 a share.

Now we might say that because it's true therefore there must be some underlying reason other than just that everyone believed it. But over The Pond on the London market (the ) everyone thought exactly the same thing about shares in the £1 to £10 range. There would be consolidations of shares trading under £1, splits in stocks trading over £10. And given that we've got entirely different numerical ranges here for the same behaviour it's very difficult indeed to think that it's the result of anything other than a folk belief, a fetish if you like.

Indeed, there's one more detail. ADRs are American Depositary Receipts. It's a way of getting a London (or other market) stock traded on Wall Street and to US retail investors. And traditionally a London quoted stock will put 10 of those London shares into one ADR. Purely and simply to get a stock trading in London in that £1 to £10 range into that $10 to $100 range deemed suitable for New York. No other rhyme nor reason to it than that.

So why have we seen Apple trading up to $700, Google now at $1,000, Priceline over $1,000 (and of course at whatever $70,000 odd it is) these days when people in the past would have insisted that value could be added by a 10 or 20 to one stock split?

The most obvious answer is that either these companies or the wider market have simply stopped believing that folk tale, simply have got over their fetish about the nominal value of a stock and are now concentrating where they always should have been, on the enterprise value. At least, that's the best explanation I've got and if you've a better one please do let me know in the comments.